While a family residence is typically a family’s most valuable asset and long-range investment toward retirement, it is much more because it is the place that is the centerpiece of a family’s life experiences – in short it is a family’s home. Tragically, the recession that continues to drag on has caused many families to lose this very special asset that is comprised of equal parts sentimental value and financial investment. Over 250,000 people lose their homes to foreclosure each year according to the Mortgage Bankers Association. It is easier to understand the magnitude of this data when one considers that on average parents of at least one child in every classroom in the U.S. is in danger of losing their home. The Arizona Chapter 13 Bankruptcy attorneys at Stone Rose Law work diligently to protect your homes and financial future.
The most disheartening part of the mortgage meltdown is that many people that lost their residence to foreclosure could have prevented the loss of their family home. Chapter 13 Bankruptcy provides an effective way for homeowners to seek debt relief while protecting their family home. A Chapter 13 Bankruptcy permits you to keep your property (i.e., family residence), but pay back all or a portion of your debts over a three or five-year period. This provision of the Bankruptcy Code is also an important source of relief for debtors who cannot qualify for a Chapter 7 Bankruptcy in Arizona under the means test because they are unable to meet the income requirements.
While it is usually advisable to seek prompt legal advice and file for bankruptcy relief sooner rather than later, this is especially true when filing a Chapter 13 Bankruptcy. Anyone seeking Chapter 13 Bankruptcy relief in Arizona faces the opposite problem faced by many in trying to qualify for Chapter 7 bankruptcy protection. Whereas some cannot qualify for a Chapter 7 Bankruptcy because their income is too high, a fundamental criterion to qualifying for a Chapter 13 is not having enough income to fund a repayment plan. This means that depending on the specifics of your situation you may have a better chance of qualifying for a Chapter 13 Bankruptcy before your arrearages accrue too far planning payment too high for you to afford to pay.
At Stone Rose Law, we do not have an assembly line approach to the bankruptcy process. Our experienced Arizona bankruptcy attorneys carefully evaluate the complete financial situation of our clients to determine if bankruptcy is the right option as well as whether a Chapter 13 Bankruptcy is the appropriate option for you. We analyze whether you can qualify for a discharge under Chapter 7 or are required to file under Chapter 13.
Even if you have a family home, we may employ other creative strategies that merge the benefits of a Chapter 7 and Chapter 13 bankruptcy. We may use a Chapter 7 bankruptcy to reduce the debt load associated with your unsecured debt and make it easier for you to qualify for a Chapter 13 because your total debt obligation will be lower which means that you will need less income to qualify.
If your total debt burden is too high, you may not qualify for a Chapter 13 Bankruptcy even if your income is high enough to permit you to fund a Chapter 13 payment plan. The maximum amount of secured debt you are allowed when seeking Chapter 13 Bankruptcy relief is $1,010,650 while unsecured debts cannot exceed $336,900. If you are unsure about your eligibility for a Chapter 13 Bankruptcy or whether Chapter 13 is the best option for you, the experienced Arizona Chapter 13 Bankruptcy attorneys at Stone Rose Law can advise you regarding your rights, eligibility, and legal options.
Once an Arizona Bankruptcy attorney has helped you assess your eligibility for a Chapter 13 bankruptcy and the appropriateness of a Chapter 13 given the facts of your specific situation, you are required to participate in credit counseling with an approved program before you may qualify for a Chapter 13 Bankruptcy discharge in a Federal Bankruptcy Court in Arizona.
The bankruptcy paperwork that must be completed and filed with the Bankruptcy Court will include a bankruptcy plan that will indicate how debtors will be treated under the plan including specific indications of the amount that each creditor will receive. Certain debt referred to as “priority debts” must be paid in full under the plan while other debts may have unpaid balance discharged once the Chapter 13 plan has been completed. Priority debts include alimony, spousal support, unpaid wages and particular obligations owed to tax entities.
The plan payment will include amounts toward priority debts, arrearages on secured debts and amounts that it has been determined that you can afford to pay toward non-priority creditors like credit card finance companies. The amount that must be paid toward unsecured debt, such as credit card debt and medical bills is determined by your disposable income after paying secured and priority creditors along with an amount designated to your monthly living expenses. If your income is above the medium income for the state, you will typically have to use a plan of 5 years before having the remaining unsecured non-priority balances discharged. A person with an income below this threshold may have their remaining unsecured debt balance extinguished by discharge after 3 years.
Stone Rose Law provides legal counsel and represents clients in Chapter 13 Bankruptcy proceedings throughout areas in Arizona including:
It is difficult to estimate how many people have needlessly lost their family home to foreclosure because they simply thought they had no options. If you are behind on your mortgage and fighting off other creditors, you should know that you are not alone. Almost half of all people take home less income than they spend each year and live paycheck to paycheck. Many families find themselves in a financially untenable situation because they refinanced before the real estate market crash and home mortgage meltdown. A great number of Arizona homeowners unwittingly obtained an adjustable rate mortgage and now have no equity to refinance.
We understand that you may be feeling stressed and overwhelmed, but the experienced Arizona bankruptcy attorneys at Stone Rose Law have helped people just like you protect their home and reboot their financial situation. Our proudest bankruptcy accomplishment is represented by the many clients that we have helped emerge from a Chapter 13 Bankruptcy who go on to achieve financial security and prosperity.
Our experienced Arizona Chapter 13 Bankruptcy attorneys provide a free initial financial analysis so we can assess your situation and determine whether a Chapter 13 Bankruptcy is the most appropriate solution to your financial hardships. We understand the financial challenges of those behind on their mortgage and/or other financial obligations throughout Arizona and are here to provide practical effective solutions to your financial challenges. We are available to address your Chapter 13 Bankruptcy questions so get in touch with Stone Rose Law today at 480-498-8998.